6 Reasons to Swap Spreadsheets for Cloud Accounting Software

Many small business owners have been using spreadsheets to do their accounting for years now. Whilst spreadsheets may seem like a convenient and cost-effective way of managing your finances, advances in cloud accounting software mean that your business could most likely benefit from an upgrade. Let’s look at why you should swap your spreadsheets for cloud accounting software and how to make the transition smoothly.

1. Data Entry

Not only is manual data entry mind-numbing, but it also makes it very easy to make mistakes. Just one typo could lead to significant errors, including errors on your tax return, resulting in missed deductions or penalties.

However, cloud accounting software allows you to upload your receipts and invoices directly and keep accurate records, removing the need for double data entry and reducing the likelihood of mistakes.

2. Lost Data

The larger a spreadsheet becomes, the more likely it is to crash or corrupt, resulting in lost data. However, your records don’t cease to matter once your tax return has been filed. It’s essential to keep your records for audits and to track the company’s progress over time. Leaving your data in a spreadsheet leaves it vulnerable, whereas cloud-based accounting software provides multiple layers of protection to keep your information safe.

3. Integration

Spreadsheets don’t tend to integrate well, leading to stress and wasted man-hours. Saving a spreadsheet in a new location can corrupt files and break links, causing countless problems. However, cloud accounting software automatically syncs your data across various devices and is designed to integrate well with other software, permitting seamless sharing and collaboration.

4. Audit Trail

Spreadsheets don’t create a clear audit trail in the same way that accounting software does. For example, you may notice changes in the data but be unable to identify the exact details. It’s essential to keep a step-by-step record to keep your company safe and your records accurate. Accounting software lets you easily maintain a log of all changes made to your files, dating right back to their initial creation.

5. Time

Spreadsheets tend to be much more time-consuming than cloud accounting software, especially if you’re working with a high volume of data. Using spreadsheets requires you to spend much time on data entry, preparing reports and verifying information. This could cost you days’ worth of man-hours! With cloud accounting software, on the other hand, these processes take mere minutes to complete.

6. Collaboration

The sharing functionality of traditional spreadsheets tends to be slow and can become confusing when multiple people try to work on a document at once. The design of cloud accounting software facilitates collaboration and, as mentioned previously, automatically syncs across all devices, permitting seamless sharing and creating an accurate audit trail.

How to Choose the Right Cloud Accounting Software

The right cloud accounting software for your small business will depend on your particular requirements, and it’s worth asking your accountant for recommendations. We recommend considering the following:

  • Which systems do you want to integrate the software with?
  • How many people will use the software?
  • Which functions are most important to your business?
  • What is the upfront cost or subscription fee?
  • How much training is required?
  • What support is provided?
  • Is the software scalable as your business evolves?

Summary

If you’re still using spreadsheets for your small business accounting, it’s time for an upgrade. Using spreadsheets is almost as outdated as working with pen and paper! Cloud accounting software can save you a considerable amount of time and money, as well as protecting your data and maintaining more accurate records. For a relatively small investment, it offers a substantial return.

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